Committee Reports > List of Committees > Dáil > 1979 > Committee of Public Accounts > Report - Appropriation Accounts 1976

REPORT

PART I—GENERAL OBSERVATIONS

MINUTE OF MINISTER FOR FINANCE DATED 18 OCTOBER 1978

REPORT DATED 28 JUNE 1973

Payments to Special Regional Development Fund (Grant-in-Aid)

1. The Committee notes that the inquiry by an inter-Departmental committee into the appropriate organisation and structures for the discharge of the functions of Government at sub-national levels is continuing and that, following the establishment of the Department of Economic Planning and Development, the committee was asked to consider specially and make a report on the appropriate organisational arrangements for the co-ordination of regional planning and development by that Department. The Committee also notes that it is now expected that the inter-Departmental committee will submit its report in the near future and that the result of its inquiry in so far as it relates to the operation of the Special Regional Development Fund will be conveyed to the Committee.

REPORT DATED 30 OCTOBER 1975

Agriculture—Recovery of Loans

Para 30

2. The Committee notes that in advising that the Minister for Agriculture had a satisfactory legal basis for pursuing the recovery of these claims the Attorney General had also stated that there were many legal difficulties involved apart from the policy considerations which might influence the Minister. The Committee also notes that the Minister for Agriculture took the view that there were practical difficulties in that, after a lapse of over five years during which the meat factories assumed that the moneys, which were interest free, were of the nature of an operating subsidy, it would be virtually impossible to get agreement from the factories to any voluntary scheme of repayment. The Committee further notes that the Minister for Finance, on the recommendation of the Minister for Agriculture had decided, as a matter of policy, to waive formally the obligation to repay the loans and that this decision had been taken not only in the light of the legal difficulties but also in the light of all the factors surrounding the issue of the moneys eg., the circumstances in which the decision to assist the meat factories was first taken, the purpose for which the assistance was intended and the constraints at the time associated with the issuing of a straightforward subsidy.

When the Accounting Officer of the Department of Agriculture was before the Committee in connection with the 1976 accounts it took the opportunity of discussing this matter further with him. He informed the Committee that while the moneys made available to the meat industry were described as loans there was always an element of intention to give them the money more or less permanently. While the Department had hoped that there might, at some stage, be an opportunity of recovering the money and the factories had hoped that they would be able to get the money as a grant there were certain difficulties on the international side which prevented grants being given at that stage. Five or six years later without anything having happened in the meantime except that the deficiency payments to the industry out of which the loans were to be repaid had ceased after Ireland’s accession to the EEC it was reasonable to assume that the meat factories believed that they would not have to pay back the money. While the Accounting Officer agreed that the meat factories did extremely well financially after 1973 he stated that the original reason for giving the loans was to maintain employment and that if the moneys had been repaid later the cost would not have been borne by the factories but would have been passed on to the farmers who supplied the cattle.

Despite the arguments put forward in this case the Committee has difficulty in accepting that the matter was handled as well as it might have been. While it would agree that a lapse of over five years might give rise to practical difficulties in recovering the moneys it is not aware of any reason why there should have been such a long lapse of time. Furthermore, having regard to the conditions on which these moneys were provided the Committee is at a loss to understand why the meat factories should have assumed that they were in the nature of an operating subsidy rather than repayable loans. If such an assumption was made by the factories the Department of Agriculture should have taken steps promptly to make them aware of the true position. These moneys, amounting to almost £1 million, have now been irretrievably lost to the Exchequer but the Committee considers that this need not necessarily have happened if the Department of Agriculture had been more diligent in the matter. The failure to recover the moneys provided by way of temporary assistance to the meat industry must be considered all the more serious in the light of the conclusion of the Review Body set up by the Minister for Agriculture to examine the operation of the Beef Intervention and Cattle Slaughter Premium Systems (Prl. 5769) that the meat factories had earned excessive profits following Ireland’s entry to the EEC, an event which took place very shortly after the loans had been provided.

The Committee is concerned lest the decision in this case might lead Departments to adopt a casual approach towards the recovery of moneys due to the Exchequer and it therefore considers that Accounting Officers should be reminded of their responsibilities in this matter.

REPORT DATED 24 JUNE 1976

Public Works and Buildings

3. The Committee notes the steps taken to improve the cost accounting strength of the Office of Public Works and hopes that these measures will prove effective.

Delays in collection of Monetary Compensatory Amounts

4. The Committee notes that the amount of MCA charges outstanding in the cattle and beef sector at the end of August 1978 was £0.89 million and that this included a sum of £0.29 million in respect of which court judgements had been obtained but had not been met. It also notes that legal proceedings had been instituted against a total of 71 debtors but had not been completed in 32 of those cases.

When the Accounting Officer was before the Committee in connection with the 1976 accounts he stated that most of the money outstanding relates to continental exporters and as a result of suggestions made, following discussions with the EEC Commission in Brussels, these were being followed up.

He also stated that further arrears were unlikely to arise except in one type of case where pigs and cereals were legitimately exported to Northern Ireland, brought back illegally and re-exported to get more sets of documents properly completed. In this type of case, which became known as the carousel trade, no loss to the Exchequer or to FEOGA would arise. The transactions were being investigated by the Customs authorities and while MCA charges of £1.8 million could arise the Department had withheld over £3 million due to the exporters. The Committee wishes to be informed of the outcome in this case.

The Committee welcomes the extension, with effect from 2 October 1978, to all agricultural exports of the arrangement whereby MCA charges are being collected by the Customs Branch of the Office of the Revenue Commissioners, either through the provision by exporters of an appropriate advanced security or by payment of the charge at the time of export. It trusts that this arrangement which is designed to ensure against arrears of charges arising in any sector in the future will be successful.

REPORT DATED 21 APRIL 1977

Office of the Minister for Education-National Council for Educational Awards

5. The Committee notes that the attention of all Accounting Officers has been drawn to its recommendation that when consideration is being given to the method of financing new bodies care should be taken to select the most practicable method and that the Minister for Finance accepts that his Department has a measure of responsibility in this regard.

Primary Education—Scheme of Adaptation and Extension for a National Teacher Training College

6. The Committee notes that the Minister for Finance has been informed by the Department of Education that negotiations are proceeding with the building contractor in relation to a claim by him for reimbursement of costs arising out of the temporary cessation of work and that, pending the result of these negotiations, it is not possible to give the final cost of this project. The Committee hopes that these negotiations will be speedily concluded and that there will be no undue delay in providing the information which it sought.

The Committee also notes that, in regard to the question of securing a contribution from the college authorities towards the expenditure incurred, the Minister for Finance has agreed, subject to the college observing competitive tendering in future capital works, with a proposal from the Department of Education that a claim for such a contribution should not be pursued.

The Committee further notes that the Chief State Solicitor is preparing a draft of an agreement for execution with the college authorities guaranteeing the exclusive use of the college for the training of national teachers or for other educational purposes approved by the Minister for Education. The Committee hopes that there will be no undue delay in completing this agreement and it wishes to be kept informed of the progress being made in this matter.

The Committee welcomes the Minister’s action in informing all Accounting Officers of the necessity for strict compliance with the general policy of competitive tendering for public works’ contracts.

Secondary Education—Local Contributions towards Capital Costs of Community Schools

7. The Committee notes that further difficulties have arisen in relation to the settlement of the model deed of trust governing the operation of community schools and that it may therefore be some time before it is possible to collect the local contributions towards their capital costs.

While the Committee recognises that, because of the issues arising in this case, the Department of Education is encountering serious difficulties in getting the agreement of all the parties involved it must express its concern at the delay which has arisen because, in its experience, when such delays occur, the State is the party most likely to lose. This is borne out by the case involving the Department of Agriculture and the meat factories already referred to in this Report.

The Committee is also concerned that the protracted delay in executing the deeds of trust for these schools not only prevents the collection of the local contributions but must, in the Committee’s view, have a serious effect on the efficient operation and management of these schools which were built at considerable cost to the Exchequer.

The Committee will await with interest the further information promised in this matter.

Office of Public Works—Government Offices at Athlone and Castlebar

8. The Committee notes that arrangements have now been made with the Commissioners of Public Works for the noting in the Appropriation Accounts of exceptional cases of expenditure incurred on the preparation of plans which are not proceeded with. The Committee regards this position as satisfactory.

Charging of Expenses arising out of Market Intervention

9. The Minute of the Minister for Finance indicates that, in regard to market intervention expenses, there are three main areas involved:-

(a) payments to meat factories for transport,

(b) payments to meat factories for freezing beef, and

(c) payments to cold stores.

In regard to (a) and (b) the Committee notes that the clearance of arrears is reaching finality. In regard to (c), which is by far the largest area to be dealt with, the Committee is concerned to note that the Department is still experiencing difficulties in clearing invoices. While it can accept that the different and often very complicated systems of invoicing used by Irish, UK and continental cold stores in which beef was held in the 1974-1976 period may have given rise to difficulties not of the making of the Department of Agriculture it can see no justification for the Department’s failure to set up satisfactory stock records for that period. The lack of such essential records would suggest that there was inadequate advance planning to cope with intervention operations and the Committee sees the situation which now exists as an example of what can happen when a Department has not made adequate preparation for a new type of operation, especially one of the scale with which we are here concerned.

When the Accounting Officer of the Department of Agriculture was before the Committee in connection with the 1976 Appropriation Accounts it took the opportunity of discussing this matter further with him. He informed the Committee that they were still working on the 1975 FEOGA accounts. In 1976 it had been decided to computerise the records but this had given rise to endless difficulties in 1977 and part of 1978. Serious staff problems had arisen on the computer side because of the attractions of the more remunerative private sector employment. The original computer programs were deficient in some respects but the Department of the Public Service had made strenuous efforts to get the records in order and the position had improved considerably.

The Committee notes that every effort is being made to complete clearance of the cold store accounts and it wishes to be kept informed of the progress in this matter.

FEOGA Accounts

10. The Committee has again considered the delay in the preparation of the FEOGA accounts. It accepts that, as stated in the Minute of the Minister for Finance, some progress has been made but it is concerned at the slow rate of this progress. It notes the forecasts now being made in relation to the production of the outstanding accounts and it urges that all necessary steps be taken to ensure that the time-scale set out in that Minute will be strictly adhered to. It wishes to be kept fully informed of developments in the matter of bringing these accounts up to date.

REPORT DATED 15 JUNE 1978

Clearance of Cashed Payable Orders by the Paymaster General

11. The Committee notes that at the date of his Minute the Minister for Finance was still awaiting a reply on the question of the legal position of the Paymaster General’s Office in regard to the claim for recovery of the amounts paid out to certain banks on foot of payable orders which were subsequently found to be fraudulent. It also notes that a preliminary report prepared by the Central Data Processing Services of the Department of the Public Service on the computer system to deal with the clearance of payable orders was being examined.

In evidence before the Committee the Accounting Officer stated that legal advice had recently been received and that it supported the view that the Department of Finance had a case for recovery of the moneys from the banks concerned. In the circumstances the Committee hopes that such recovery will be effected without further delay. The Accounting Officer also stated that, in regard to the capacity of the Paymaster General to clear orders promptly, arrangements had been made for the computerisation process to be speeded up drastically. The Committee welcomes this information and expects that the action taken will prevent a recurrence of this problem.

Office of the Minister for Education—National College of Art and Design

12. The Committee notes that the Department of Education has indicated that the position in regard to the audit of the accounts of the National College of Art and Design has improved and that, in order that the board of the College might be made fully aware of its responsibilities in the matter of accounting, a copy of the Committee’s comments has been sent to the chairman of the board. The Committee also notes that the Department of Education was asked to examine the statutory provisions relating to this matter and to consider their amendment, if necessary, so as to ensure that the College authorities fulfil their statutory obligation in regard to the submission of their accounts annually to the Comptroller and Auditor General.

When the Accounting Officer appeared before the Committee in connection with the 1976 Appropriation Account he pointed out that, as the accounting situation at the National College of Art and Design was now fairly normal, his Department did not feel they would be warranted in introducing amending legislation. The Committee welcomes the assurance of the Accounting Officer that the position regarding the production of the College’s annual accounts is now satisfactory and hopes that there will be no further dilatoriness in this respect in future.

Office of the Minister for Education—National Council for Educational Awards

13. The Committee notes that the difficulty which arose in regard to the funding of the National Council for Educational Awards will not be repeated because the Council has now become a designated institution of the Higher Education Authority and is being funded through the grants-in-aid of the Authority.

Appendix 11

Primary Education—Overpayments of Teachers’ Salaries

14. The Committee notes that the Minister for Finance has been informed by the Department of Education that original payable orders for the payment of teachers’ salaries are, in fact, cancelled at the same time as duplicates are issued. This information would appear to be in conflict with that furnished by the Accounting Officer to the Comptroller and Auditor General and with his evidence before the Committee when the Appropriation Accounts for 1975 were being considered. However, in the light of the position as reported in the Minute of the Minister for Finance the Committee accepts that the proper procedure in regard to the cancellation of payable orders on the issue of duplicates is being followed by the Department of Education.

In evidence before the Committee when the Appropriation Accounts for 1976 were being considered the Accounting Officer indicated that the problem of the encashment of both original and duplicate orders arose in many cases because of difficulties in the Paymaster General’s Office. At the request of the Committee the representative of the Department of Finance sought the views of the Paymaster General’s Office as to whether it would be possible to refuse payment on cancelled orders which had been presented to and paid by banks or whether the Paymaster General’s Office could notify the banks of the cancellation of orders and request them to stop payment thereon. In a memorandum submitted subsequently the Department of Finance indicated that neither of these proposals would be practical. In the first place it would not be feasible to return all cancelled orders to the banks because of the number of such orders coming to light, most of which are found on investigation by the issuing Department to be acceptable. Furthermore, notification of cancelled orders to all banks would not be in line with the practice in the private banking sector.

While the Committee would agree generally with this view it feels that when cancelled orders which have been cashed by banks are presented to the Paymaster General’s Office they are not identified as quickly as cancelled cheques would be in the private banking sector. It would accordingly welcome information on the length of time taken to identify cancelled orders in the Paymaster General’s Office by comparison with the length of time taken to identify cancelled cheques in the private banking sector.

Primary Education

15. The Committee welcomes the information that the Office of Public Works has now leased new accommodation in which it is proposed to house all the accounting sections of the Department of Education and that, in addition to the provision of a strong-room in which all payable orders will be kept, the premises will be protected by strict security arrangements operated by the lessor.

Secondary Education

16. The Committee welcomes the assurance that the Department of Education has made arrangements to ensure the elimination of the deficiencies which led to a breakdown in 1974 and 1975 in the accounting procedures relating to the salaries of secondary, comprehensive and community school teachers. It notes that income tax and other deductions are being paid over to the appropriate Departments or agencies on a regular basis since 1976. The Committee also notes that computerisation of these payrolls, which was expected to be completed in 1978, incorporates the necessary controls to ensure the timely payover of deductions and to effect the required reconciliations. The Committee trusts that these new arrangements will work satisfactorily and that there will not be a repetition of this problem.

Appendix 12

Secondary Education

17. The Committee notes that appropriate deductions are now being made by the Department of Education from the salaries of teachers in secondary, comprehensive and community schools who are entitled to and receive social welfare benefits in respect of absence on maternity leave or ordinary sick leave, and that individual cases of such teachers who were paid full salary while on maternity leave in the period 1 January 1975 to 31 July 1976 are still being pursued. Following his examination in connection with the 1976 Appropriation Accounts the Accounting Officer informed the Committee that, because of the concentration of staff time on the computerisation of secondary teachers’ salaries, action in regard to the recovery of these payments had not been concluded but that on the completion of the computerisation the recovery operation was being given full priority. The teachers concerned and the periods of absence involved had been identified and the Chief State Solicitor had been consulted as to the recovery procedure which might be followed. He had recommended that, as a first step, the teachers should be asked to refund to the Department of Education sums equivalent to the amounts of Social Welfare benefit paid to them. In the event of failure to recover the moneys in this way the further steps to be taken would be considered. The Accounting Officer added that some of the persons concerned had left the teaching service, and one had died. The Committee would like to be informed of the progress made to effect recovery of moneys due. The Committee also notes that the Minister has been advised by the Department of the Public Service that unestablished civil servants, State industrial employees and civilian staff attached to the Defence Forces and the Garda Síochána who are fully insured under the Social Welfare code and are thereby entitled to disability benefit, may, subject to certain conditions, be allowed full pay less Social Welfare benefits in respect of sick absences. The Committee appreciates the concern of the Minister to ensure that stringent precautions are taken to avoid double payments and it welcomes his action in reminding Accounting Officers of their responsibilities in this matter.

Vocational Education

18. In regard to the delay in completing the audits of the accounts of Vocational Education Committees and of Regional Technical Colleges the Committee notes that the general situation in relation to Local Government audit staff is being kept under review. As pointed out by the Committee in paragraph 30 of its previous report a somewhat similar problem exists in regard to the completion of the audits of some other accounts by Local Government Auditors. The Committee’s further comments on the delays occurring in the completion of these audits are contained in paragraph 21 of this Report.

Fisheries

19. The Committee is concerned that agreement has not yet been reached with Mayo County Council on the amount of its contribution towards the cost of the improvement scheme at Killala harbour, a scheme which commenced in 1969. It notes that efforts to reach agreement are continuing and that, as a result of the most recent meeting between the parties concerned, a comprehensive report prepared by the Office of Public Works on the present condition of the pier and the further works considered necessary was sent to the County Council which undertook to reconsider its position when this report had been examined. The Committee also notes that the sheet-piling which was purchased for the scheme is not perishable and can be used on some other work should it transpire that it is not required for the Killala scheme.

When the Accounting Officer for the Vote for Fisheries was before the Committee in connection with the 1976 Account it took the opportunity of seeking further information on this matter. The Accounting Officer stated that the suggestions made in the report by the Office of Public Works were not acceptable to the County Council and that a meeting with the Minister for Fisheries and Forestry was being arranged to discuss the matter.

The Committee will await further information on this matter.

Roinn na Gaeltachta—Personal Responsibility of Accounting Officers

20. The Committee notes that Roinn na Gaeltachta intended to take all possible steps to ensure that the Bill to make all the necessary amendments to the Housing (Gaeltacht) Acts would be ready for the next session of the Dáil. When the Accounting Officer for this Vote was before the Committee in connection with the 1976 Account he recalled that a Bill providing for increased grants, operative from 1972-73, had been prepared and approved by the Government some years previously but had not been presented to the Dáil. He stated that further increases in the level of grants had been authorised by the Government and that the Attorney General had been asked to draft the necessary provisions for inclusion in a comprehensive Bill which, hopefully, would be presented to Dáil Éireann in the near future. He added that the increases in grants, announced in 1978, would not be paid until a Supplementary Estimate was passed which would notify Dáil Éireann that legislation would be introduced as soon as possible to increase the levels of grants.

The Committee is aware that the Housing (Gaeltacht) (Amendment) Bill, 1979, at present before Dáil Éireann, contains proposals for the validation of grant increases already paid and for the authorisation of future increases by ministerial regulation.

In paragraph 29 of its Report on the Appropriation Accounts for 1975 the Committee referred to the personal responsibilities of Accounting Officers in relation to voted moneys entrusted to them and, in particular, to the prescribed procedure to be followed if an Accounting Officer is required, as a matter of policy or for any other reason, to make payments for which, in his opinion, he does not have authority. Payment of grants in excess of approved statutory limits would appear to fall into this category and the Committee is concerned that the prescribed procedure referred to does not appear to have been followed in regard to payments requiring validation to which it has drawn attention in its recent Reports. The Committee would like to be reassured that Accounting Officers are fully aware of the procedure to be followed in such cases and of the importance of doing so.

Appendix 10

Local Government

21. The Committee is pleased to learn that the staffing position of the Audit Branch of the Department of the Environment has been considerably strengthened since May 1977. While it notes that some progress has been made in the audit of the motor tax accounts it still regards the position in relation to the audit of these accounts and of the accounts of the Vocational Education Committees and the Regional Technical Colleges, to which reference has been made in paragraph 18 of this Report, as unsatisfactory. In this connection the Committee was disappointed to learn from the Accounting Officer that it was expected that at 31 December 1978 two motor tax accounts for 1975 and seven accounts for 1976 would still be unaudited. The Committee cannot accept as satisfactory a position in which the audit of the accounts of public moneys is three years in arrear and it urges that whatever further steps considered necessary be taken to bring the audit position of these accounts up to date.

Overissues of Housing Subsidy

22. The Committee notes that all amounts which have been established as overissues of housing subsidy in the period 1973-74 to 1976 inclusive have been recovered. Nevertheless, it is concerned that such overissues should have been made. It considers that as soon as prima facie evidence of the overissues became available to the Department steps should have been taken to effect recovery without waiting for audited claims, especially as there is always a danger that delay in claiming recovery of moneys due to the Exchequer may, in fact, jeopardise their recovery. The Committee recalls that the reason given by the Accounting Officer for not taking such immediate action was the likelihood that the figures for the apparent overissues would be reduced following the audit of the final claims. In the event this reason does not appear to have been well-founded as is evidenced by the figures quoted in the Minutes of the Minister for Finance for 1973-74 and 1974 which show that the actual overissues were far in excess of the figures of apparent overissues as given in the Comptroller and Auditor General’s Report.

The Committee regards the procedure adopted by the Department of the Environment for the payment of housing subsidy as undesirable and it would urge that it not be adopted in any similar situation which may arise in the future. It is concerned at the delay in establishing the full extent of all overissues since 1973-74 and in effecting recovery. It wishes to be kept informed of progress in this matter

Public Works and Buildings

23. The Committee notes that the Minister is assured that the systems of supervision and control of local stores in the Office of Public Works are fully adequate to their purpose and that the Accounting Officer has reminded all supervisors of their responsibilities to operate these controls properly. The Committee trusts that, as a result, there will not be a repetition of the problems which arose at the local centre of the Office of Public Works.

Health

24. The Committee notes that the Minister for Finance shares its concern about the accounting and recording deficiencies of some Health Boards in their earlier years. It also notes that the Minister has been assured by the Accounting Officer that the necessary steps have been taken to remedy these deficiencies and that, in addition, the Department of Health has initiated measures aimed at improving financial control in Health Boards. The Committee is pleased to learn that the Minister for Finance is bringing to the notice of all Accounting Officers its view that it is essential to have effective arrangements for proper financial controls and accounting procedures made well in advance of the setting up of any new agency involved in the expenditure of public funds.

The Committee further notes that the overall position with regard to arrears in the auditing of accounts of the Health Boards has improved considerably and that it is now aimed to have abstracts of accounts in the case of each Health Board available for audit within six months of the end of the financial year.

The Committee trusts that as a result of the measures now being taken the financial administration of the Health Boards will in future be of the highest modern standards in order to meet the requirements of proper public accountability.

Health Contributions

25. The Committee welcomes the assurance that the Minister for Finance is in full agreement with its view that the aim should be to achieve 100% collection of farmers’ contributions in all regions and that this view is also accepted by the Department of Health which has urged the Health Boards to take all necessary steps open to them to collect arrears. The Committee notes that at the date of the Minute of the Minister for Finance—18 October 1978—the question of how best to effect an improvement in the collection rate was under examination by the Minister for Health who was considering the introduction of certain legislative proposals in this matter in conjunction with the proposed amendment of the Health Contributions Act, 1971. The Committee is aware that the amending legislation—the Health Contributions Act, 1979—was enacted recently and it would welcome information as to the further steps which it is now proposed to take to improve the collection rate.

The Committee also notes that the Health Boards are being consulted in regard to the detailed information requested by it regarding levels of collection and arrears. It looks forward to receiving this information at an early date.

Comptroller and Auditor General

26. The Committee is pleased to note that the Department of the Public Service is prepared to co-operate fully in the procedure suggested for the periodic assessment of the future staff requirements of the Office of the Comptroller and Auditor General. It welcomes the assurance that the Minister for the Public Service is prepared to authorise the provision of extra staff shown to be necessary.

Explanation for Savings or Excesses on Subheads

27. The Committee notes that Accounting Officers are being reminded of the need to provide adequate notes in the Appropriation Accounts of the main reasons for the savings or excesses on subheads. The Committee therefore expects to see an immediate improvement in the position and hopes that it will not have to refer to this matter again.

Provision of Secretarial Service for the Committee

28. The Committee notes the arrangements now made to enable a Principal Clerk to give full-time attention to its affairs in the future.

The Committee is satisfied with the outcome in this matter.

PART II—PARTICULAR ACCOUNTS

SUPERANNUATION AND RETIRED ALLOWANCES

29. The Committee noted from the Report of the Comptroller and Auditor General that the Civil Service Widows’ and Childrens’ Contributory Pension Scheme, 1977 and the Civil Service Widows’ and Childrens’ Ex-gratia Pension Scheme, 1977, which were signed by the Minister for the Public Service on 9 May 1977, retrospectively validate the payment of contributory pensions and ex-gratia pensions to the dependants of civil servants. The Committee also noted that enabling legislation already exists for the validation of awards of contributory and ex-gratia pensions to the dependants of other public servants and that the necessary validation schemes are in the course of preparation by the Departments concerned. The Committee wishes to be kept informed of the progress being made with the preparation of these schemes.

OFFICE OF THE REVENUE COMMISSIONERS INCOME TAX OUTSTANDING

30. The Committee noted that the figure in respect of income tax outstanding had increased from £77 million at 31 May 1976 to £136 million at 31 May 1977. The Accounting Officer in evidence pointed out that the greater portion of this increase occurred in the figures relating to tax under appeal or under inquiry. Changes in the law in recent years had tended to throw a greater amount of tax into this category. As a result of these changes about 90% of assessments now being issued are estimated assessments as against 40% under the previous arrangements. The immediate response of the taxpayer to an estimated assessment is to lodge an appeal and thus the number of cases and the amount of tax in the “under appeal or under inquiry” category has increased considerably. The figure for tax in this category does not therefore reflect reality despite efforts being made to reduce the time between making an estimated assessment and making a final assessment. The Accounting Officer also explained that, if taxpayers made more use of the statutory provision allowing them to specify, when appealing against an assessment, the amount which they consider to be properly payable, the figures for tax outstanding in this category might be less distorted.

The Committee recognises the difficulty of the Revenue Commissioners in arriving at a realistic figure for tax outstanding in the “under appeal or under inquiry” category.

It wonders whether, as a first step, it would be possible to identify the amount in this category which relates to final assessments as distinct from estimated assessments.

The Committee also noted the increase in the amount of income tax outstanding in the other two categories as shown in the Report of the Comptroller and Auditor General. It accepts that, where the collection of tax is held up for such reasons as bankruptcy, death etc., there is, as the Accounting Officer stated, very little that can be done by the Revenue Commissioners by way of exerting pressure because other legal processes, which can take a long time to complete, have taken over. In regard to tax in the “due for collection” category, however, the Committee is concerned to note that the amount outstanding has increased from £16 million at 31 May 1976 to £28.5 million at 31 May 1977-an increase of more than 75%. The Committee would welcome information as to the reasons for this very considerable increase and would like to be assured that there is no undue delay by the Revenue Commissioners in pursuing the collection of tax where the amount has been agreed and where legal difficulties should not arise.

WEALTH TAX—DELAY IN SUBMITTING RETURNS

Qns 202, 203

31. The Comptroller and Auditor General drew attention to the delay by persons assessable to Wealth Tax in submitting to the Revenue Commissioners their statutory returns for 1975 and 1976 as provided for in the Wealth Tax Act, 1975. The Accounting Officer had informed the Comptroller and Auditor General that because of the statutory provisions relating to the charging of interest on overdue tax the bulk of the correspondence relating to the 1975 and 1976 valuation dates reached the Capital Taxes Branch of his Office during a short period in each of those years. This led to the build up of a backlog of work which had to be cleared before attention could be given to cases in which returns had not been submitted. He added that the duty of following up such cases had subsequently been assigned to a new section set up in the Office of the Revenue Commissioners.

In evidence the Accounting Officer reiterated that the difficulty arose from a combination of the newness of the tax and the fact that the incidence of work occurred at a particular time of the year rather than being spread over the whole year. He explained that this difficulty related to the question of staffing. Moreover, as with all new taxes, there had been teething troubles with the Wealth Tax.

He stated that although the Wealth Tax had been abolished the Revenue Commissioners were still engaged in tidying up and collecting amounts that had become assessable while the tax was in operation.

The Committee would like to be informed whether all Wealth Tax assessments have now been made in respect of the period during which that tax was in operation and what amount, if any, remains to be collected.

POSTS AND TELEGRAPHS—CABLE TELEVISION FEES AND TELEVISION LICENCE DEFAULTERS

Qns 226-230

32. The Comptroller and Auditor General drew attention to the failure of the holders of licences for the provision of cable television service to comply with the provisions of the Wireless Telegraphy (Wired Broadcasting Relay Licence) Regulations, 1974. The Regulations require a licensee to pay, on the last day of each quarter, to the Minister for Posts and Telegraphs a fee equal to 15% of his gross revenue in that quarter excluding installation charges and Value-Added Tax, and, in addition, to furnish annually to the Minister an audited statement of such gross revenue. The Comptroller and Auditor General had observed that some licensees had paid over fees but had not submitted audited statements and that other licensees had neither paid fees nor submitted audited statements. The Accounting Officer had informed the Comptroller and Auditor General in May 1978 that, while the problem was still an ongoing one, certified statements had by that date been received from a number of licence holders and proceedings were being instituted in three cases where the statutory fees had not been paid. The Committee would urge that all steps be taken to ensure that the provisions of the relevant regulations are complied with by all licensees. It wishes to be informed of the up to date position in regard to the submission of annual statements of gross revenue and the collection of fees due by the licensees.

The Committee also considered the question of default by owners of television sets in the matter of payment of the annual licence fees. The Accounting Officer stated that the Department of Posts and Telegraphs carries out a campaign each year in order to detect defaulters and, while a considerable number of defaulters are detected, the problem is a continuing one.

The Committee notes that, while it is not possible to establish what the actual number of defaulters is, it has been estimated that the total of the licence fees not being paid would be in the region of £1.5 million per annum, a fairly substantial sum in relation to the total of licence fees collected. The Committee is aware of the efforts being made by the Department of Posts and Telegraphs to detect defaulters and it welcomes the information that a considerable number are being detected. It wonders whether the Department has considered the feasibility of requesting cable television service licensees to submit names and addresses of users of their service with a view to ascertaining whether they include any defaulters in the matter of payment of licence fees on television sets.

LOCAL GOVERNMENT

33. Local Authorities, whose accounts are audited by Local Government Auditors, receive substantial amounts of their annual income from voted moneys and from the Road Fund; in 1976 housing subsidy paid to them amounted to £29,601,896, water supply and sewerage grants to £5,167,579 and grants from the Road Fund to £20,705,428. The Comptroller and Auditor General was concerned to note from the auditors’ reports that there were certain shortcomings in the financial control procedures operated by some local authorities. The Accounting Officer had informed him that the efficiency of the administration of the local authorities is the responsibility of the various county or city managers and that they were reminded on a number of occasions of the need to give particular attention to the matter of financial control. In recent years considerable progress had been made in this area by the modernisation of the accounting processes including the introduction of a new form of estimates designed to give a better framework for financial control. Furthermore, steps had been taken to improve the staffing position on the financial side and a new grade of Finance Officer had been introduced. One such officer had already been appointed in one local authority area, four more had been approved, and steps were being taken to appoint others according as vacancies occurred in the posts of County Accountant. The Finance Officer post is of a higher grade than that of County Accountant and the duties specifically include the work of internal auditing. The Accounting Officer, however, explained that the appointment of Finance Officers in the local authority areas could take some time because it depended largely on the occurrence of vacancies arising from retirements in the posts of County Accountants.

The Accounting Officer added that further steps taken to improve financial control include the monitoring on a quarterly basis of expenditure and estimates by the Department in conjunction with city and county managers, the setting up of courses for accounts’ branch staff and the publication of a volume of detailed accounting instructions prepared by the Department’s auditing staff.

The Committee shares the Comptroller and Auditor General’s concern at the inadequacy of the financial controls exercised by some local authorities. It welcomes the steps being taken to effect an improvement in this area especially the appointment of Finance Officers and it urges that the recruitment of such officers be expedited as and when their appointment is considered necessary in local authority areas.

HOUSING SUBSIDY—RENT ARREARS

34. In respect of the period from 1 April 1973 to 31 December 1976 the deficits incurred by local authorities on the provision of local authority houses for letting have been subsidised by payments made from voted moneys. Claims for subsidy were made by local authorities on the basis of the deficits shown in their housing services accounts. All local authorities except Dublin Corporation prepare these accounts on a receipts and payments basis and therefore only bring to credit in any year the rents actually received. Failure to collect rents would therefore have the effect of increasing the deficits shown on the housing accounts. Dublin Corporation, which prepares its accounts on an income and expenditure basis, made a provision of £1 million for rent arrears in accounts for 1973-74 and 1974. Annual returns made by local authorities under the Public Bodies Order, 1946 showed that the amounts of rent arrears outstanding in some cases were considerable and the Comptroller and Auditor General inquired as to the extent to which such arrears might have been subsidised from voted moneys from 1973-74 onwards.

The Accounting Officer explained that a rent strike by local authority tenants which had been in existence in several areas at 31 March 1973 had led to difficulties. The matter was being reviewed by his Department and proposals would be made to the Department of Finance.

In evidence the Accounting Officer informed the Committee that, apart from Dublin and Cork Corporations, virtually all rent arrears had been recovered by local authorities. In the case of Cork Corporation it had been established that rent arrears had been subsidised to the extent of £250,000, less the rates content of approximately one-third and less an amount for purchase annuities. Since the housing services accounts of Dublin Corporation are prepared on an income and expenditure basis the question of subsidising rent arrears would not arise unless it was decided to write-off such arrears as irrecoverable. The extent of the arrears in Dublin city had been reduced by the acceptance of payment of arrears by instalment but they were still of the order of £1.25 million. The difficulty was that in a local authority area, where the total income from housing exceeds £6 million, some arrears are bound to arise in circumstances where they have to be written off.

The Department of Finance representative stated that his Department would accept the traditional practice of writing off small amounts of rent arrears as irrecoverable in respect of the period in question. However, since the payment of subsidy in respect of housing deficits was an open-ended commitment in the sense that the Exchequer was responsible for meeting the difference between rents on the one hand and management and maintenance costs on the other, there was less pressure on the local authorities to pursue the collection of rents generally and in particular during the period of the rent strike. He stated that the general view of the Department of Finance would be that rent arrears over and above the traditional levels are the responsibility of the local authorities.

The Committee accepts that the rent arrears which accumulated during the period of the rent strike present a special problem which no doubt calls for special consideration in cases of hardship. Nevertheless, it agrees with the general viewpoint expressed by the representative of the Department of Finance that the collection of these arrears is the responsibility of the local authorities and it would urge that every effort be made to effect their collection and thus prevent an unwarranted increase of housing account deficits in respect of the period in question falling to be met from the Exchequer. It notes that the rent arrears of one local authority have been subsidised and it expects that the amount of the subsidy will be recovered for the benefit of the Exchequer.

OFFICE OF THE MINISTER FOR EDUCATION—HIGHER EDUCATION GRANTS

Qns 327-331

35. The Local Authorities (Higher Education Grants) Act, 1968 authorises the making of grants by a local authority to eligible persons ordinarily resident in its functional area to enable them to attend university colleges or other approved institutions of higher education. The Act also provides for the refund from voted moneys to a local authority of the annual cost of such grants over and above the provision made by it in 1967-8. Annual schemes approved by the Minister for Education provide for payment of higher education grants at two rates viz a lower grant rate for eligible students whose residence is in or adjacent to a university town and a higher rate for other eligible students. In February 1970 the Department of Education issued to all local authorities guidelines for establishing, for the purposes of grant schemes, whether a student’s residence was or was not situated in or adjacent to a university town.

The Comptroller and Auditor General told the Committee that it had come to light in January 1976 that one local authority had, since the introduction of the grant scheme in 1968, continued to pay the higher rate of grant to all eligible applicants in its area, irrespective of whether their places of residence were in or adjacent to a university town. The Attorney General had advised that recovery of amounts overpaid subsequent to the issue of the place of residence guidelines in 1970 could be claimed from this authority and the Department of Finance had agreed that steps should be taken to recover an amount representing the excess grants paid since 1970 to students who should have been paid only at the lower rate. Subsequently, however, following representations from the local council concerned, the Minister for Education considered it appropriate to deem the awards made by this council up to 1976 to be in accordance with the provisions of the grants’ scheme and to decide that excess payments had not been made by the council. The Comptroller and Auditor General added that, as the Department of Finance had not been informed of this decision of the Minister for Education, he had asked that that Department be so informed.

The Accounting Officer, in evidence, explained to the Committee that the Department’s main concern was to get the local authority to accept that it should operate its grants’ scheme on the basis of whether a student’s place of residence was adjacent to or non-adjacent to a university town and the authority had agreed to do so from 1977. It was on this basis that the Minister for Education had made his decision. The local authority had stated that it was satisfied that none of the student’s concerned was, in its view, resident in or adjacent to a university town and the Accounting Officer added that this was a matter which had to be left to the local authorities to decide.

The Committee is concerned at the action taken by the Department of Education in this case which has serious implications in the matter of the control of the expenditure of public funds. It must assume that, when the Department of Education sought the advice of the Attorney General, it had prima facie evidence that excess payments of grants had been made by the local authority and that excess refunds had been made from voted moneys to that authority. This would appear to be borne out by the fact that moneys in respect of expenditure on grants in 1975 and 1976 were withheld by the Department from the authority concerned until December 1977.

The Committee has considerable difficulty in accepting the assertion of the local authority, as reported by the Accounting Officer, that it was satisfied that none of the students in receipt of grants was, in its view, living in or adjacent to the university town. The Committee would point out that the functional area of this authority is contiguous to that town and, in the circumstances, it is highly unlikely, to say the least, that over the period from February 1970 to December 1976, not one of the students who received a grant and who attended the local university college could have travelled daily from his home to that college. It wishes to learn whether the Department of Education has any evidence to show that the local authority satisfied itself before paying the higher rate grant that the grantee did not in fact so travel.

The Committee notes that the provision requiring the payment of a grant at the lower rate only to a student whose normal residence is in or adjacent to a university town is one common to the grants’ schemes approved by the Minister for Education for all local authorities. It is at a loss to understand the special considerations which resulted in the waiving of that provision in the case of one authority. It holds the view that, if the Minister for Education considered that for policy reasons this particular provision should be waived in any year, the proper course would have been to amend the grant scheme for that year and the Committee would expect that in equity such an amendment should apply to all local authority grants’ schemes. In the absence of such an amendment the Committee considers that the Accounting Officer, following the Minister’s decision, should have reported the matter to the Department of Finance and sought the sanction of that Department for the write-off of any excess payments made from voted moneys. The matter should then have been brought to the notice of Dáil Éireann by means of a suitable note in the Appropriation Account.

The Committee is seriously concerned less the action taken in this case might create a precedent which, if followed, could only result in weakening to a large degree the control over the expenditure of voted moneys and in stultifying the work of the Comptroller and Auditor General in his examination of such expenditure. It notes that the decision taken by the Minister for Education was brought to the notice of the Department of Finance at the request of the Comptroller and Auditor General and it would welcome the views of that Department on the matter at issue.

SECONDARY EDUCATION

36. The running costs of comprehensive and community schools (excluding wholetime teachers’ salaries, travel and subsistence and compensation payments) are paid by the schools out of imprest advances made from the Vote subhead which provides for a fixed budgetary allocation for each school. The Comptroller and Auditor General drew the Committee’s attention to a number of deficiencies in the financial administration of some of these schools which came to light during local audits carried out by his staff. It appears that there was a lack of control over the expenditure incurred by some Boards of Management and that excess expenditure was being financed by way of bank overdraft involving the payment of interest. This resulted in the making by the Department of Education after the end of the year of special payments over and above the budgetary allocations. Some schools had adopted the practice of deferring payments in respect of matured liabilities from one year to another. The Accounting Officer stated that the schools are advised that their budgetary allocations should not be exceeded without prior Departmental approval. He also stated that their expenditure is reviewed quarterly and that any school which is not keeping within its allocation is advised to keep its expenditure under continuous review throughout the year, to refrain from entering into any commitments involving an excess without prior approval and, if an excess is envisaged, to notify the Department, outlining the corrective action proposed. Furthermore, the schools had been asked to submit monthly a list of invoices awaiting payment so that the Department would know whether they had sufficient funds to meet commitments.

The Comptroller and Auditor General also drew attention to the inadequacy of the stock records and the stocktaking procedures at some schools which carry sizeable stocks of equipment and to a practice adopted by schools of acquiring equipment under leasing agreements and treating the expenditure incurred as running costs chargeable to the imprest account. The Accounting Officer explained that the schools concerned had been advised of the necessity for keeping proper stock records and for carrying out regular stocktaking. They had also been informed that the leasing of equipment is not normally permitted and that Departmental approval must be sought before entering into leasing agreements.

Finally, the Comptroller and Auditor General drew attention to the non-utilisation by some schools of metalwork equipment and television sets supplied to them by the Department. The Accounting Officer explained that the non-utilisation of metalwork equipment, which cost £24,848, was due to the non-availability of metalwork teachers, but that this position had now been remedied in the three schools which were involved. In regard to the non-utilisation of television sets he stated that this had occurred because of difficulty in time-tabling programmes due to unsuitability of transmission times, non-availability of piped service and poor reception in the school areas. He added that the sets not being used had since been transferred to other schools where they would be used and television sets would not be provided in future unless there was a guarantee that they would be used.

The Committee is concerned at these shortcomings in the financial administration of some comprehensive and community schools and it hopes that the suitable corrective action has now been taken. A disturbing aspect of the matter is that there is evidence to suggest that, until the Comptroller and Auditor General brought these shortcomings to the notice of the Accounting Officer, the Department was not aware of them. Comprehensive and community schools are a fairly recent addition to our State education system and the Committee would have thought that their expenditure of public funds would have been closely monitored by the Department. This does not appear to have been done in all cases.

The Committee considers that the need for such monitoring of expenditure is a strong argument for the setting up within the Department of an effective internal audit unit as a matter of urgency.

RESIDENTIAL HOMES AND SPECIAL SCHOOLS

Qns 355-357

37. The cost of the social insurance stamps of special schools’ staff paid through a school imprest account is met from that account which is funded by advances from voted moneys. When carrying out a local audit at a Special School the Comptroller and Auditor General’s staff noted that there appeared to be a discrepancy between the sums made available by the Department in the period January 1972 to December 1976 for the purchase of social insurance stamps and the value of stamps accounted for. They also noted that stamps to the value of £3,267 were on hands and that school employees’ social insurance cards for 1973-1976 also on hands were mainly unstamped. At the request of the Comptroller and Auditor General the Accounting Officer had a reconciliation carried out by his officers which disclosed a minor discrepancy of £27 assuming that an estimated sum of £620 had been expended on the purchase of stamps where this could not be firmly established by reference to insurance records or cards. The Accounting Officer informed the Comptroller and Auditor General that the Departmental investigation had afforded no basis for suspecting dishonesty, but that it did indicate that there had been laxity in the stamping of cards. The school director had agreed to adhere strictly to correct practice in the matter of stamping cards in the future. The Accounting Officer also informed the Comptroller and Auditor General that annual checks of the school accounts had been carried out at the school by officers of his Department since 1973 and, in evidence before the Committee, he agreed that these checks should have brought the discrepancies reported by the Comptroller and Auditor General to light. It appeared that the officers carrying out the checks had not been made aware of the necessity to examine the position in regard to the stamping of insurance cards but they had since been briefed on the necessity for doing so.

On the basis of the information available to it the Committee accepts the view that there was no irregularity in this case. In the circumstances it agrees to pass the unvouched expenditure of £647 as a charge against the Vote, provided the Minister for Finance is prepared to give it his covering sanction. It is concerned, however, at the inadequate standard of the annual checks carried out by departmental officers in this case. The Committee considers that all officers responsible for examining financial records and accounts should be made fully aware of the scope and purpose of the checks to be carried out by them and be fully informed generally in regard to their duties and responsibilities. It wishes that its views in this matter be brought to the notice of all Accounting Officers.

HIGHER EDUCATION

38. The Comptroller and Auditor General reported to the Committee that the expenditure incurred on the construction of premises for the National College of Physical Education exceeded the original contract price by more than 50% and he drew attention to a number of constructional defects in the buildings erected under the contract. The contract in the sum of £672,500 was entered into in 1972 but by 31 December 1976 expenditure had reached £1,039,010. The Accounting Officer indicated that, while the final account for the contract had not been completed, the expenditure incurred included £22,400 for extras due to extremely difficult site conditions, £119,210 for variations, contingencies not provided for in the contract and other extras and £224,900 for adjustments under the price variation clause and adjustments of prime cost sums.

The defects in the building were in the external wall finish and in the dimensions of the squash courts. The Accounting Officer informed the Comptroller and Auditor General that, with a view to establishing where responsibility lay for the defective wall finish, the Department of Education had obtained technical reports in the matter and had also sought legal advice as to the steps open to it to ensure that remedial work estimated to cost £70,000 would be carried out without cost to the Department. The effect of the error of some inches in the dimensions of the squash courts is that they are not recognised for national or international competitions but they continue to be used for their basic purpose of providing facilities for the teacher-students of the College. The question of pursuing a claim in relation to the squash courts would be considered when the major issue of the external wall finish had been resolved. In evidence the Accounting Officer stated that while variations are regarded as a normal feature of building contracts this one had been particularly unfortunate. Some of the variations had been requested by the contractors and some by the Department’s building unit. He also stated that the Department was legally advised that the defects must be put right at the expense of the contractors and this matter was being pursued by the Department. The Department’s consultants were drawing up details of the defects to be remedied and this would be submitted to the contractors through the Chief State Solicitor.

The Committee considers that the cost of variations not provided for in the contract, £119,210, was high and it would welcome information as to their nature. It wishes to be kept informed of the progress made to bring this contract to finality. In particular, it wishes to learn whether the defects in the buildings have been satisfactorily remedied at no cost to voted moneys and whether the matter of pursuing a claim in relation to the error in the dimensions of the squash courts has been determined.

ROINN NA GAELTACHTA

39. The Comptroller and Auditor General drew attention to a case in which a contract for the erection of a lamb fattening unit which was to be grant-aided from the Vote was entered into by a co-operative society on the basis of a single tender and apparently before Roinn na Gaeltachta had an opportunity of considering such matters as the plans, specifications and costs. In June 1974 Roinn na Gaeltachta agreed in principle to pay a grant to the society towards the cost of the unit, the amount of the grant to be determined when the society had submitted satisfactory information regarding costs. The society, however, without having furnished the information sought by Roinn na Gaeltachta, entered into a contract in the sum of £98,700 in July 1974 on the basis of a single tender. By October 1974, while the amount of the grant to be paid had yet to be determined, the project was already well advanced. At 31 December 1976 expenditure of approximately £109,000, excluding the cost of the site, had been incurred by the society under this building contract. The Accounting Officer had informed the Comptroller and Auditor General that it was unlikely that tenders would have been available from other reputable contractors and that in the circumstances it could not be said that the expenditure incurred by the co-operative society was unreasonable. The grant paid from the Vote was £74,000 which was less than 70% of the expenditure and it was clear that the society would have been in difficulties without it.

In evidence the Accounting Officer stated that there were only a few firms in the country engaged in the type of building required in this case and that normally the firm nearest to the site would be the most competitive. His Department was not particularly worried that there was only one tender obtained. He doubted whether a firm situated a long distance from the site would be interested in tendering.

The Committee is not entirely satisfied with the argument put forward by the Accounting Officer in this case. It would agree that it might have been obvious that a particular firm was the only one in a good position to undertake the work. Nevertheless it is strongly of the view that alternative quotations should always be sought. Not to do so could lead to an excessive price being quoted and, indeed, accepted, especially if the one firm being asked to tender became aware that no other firm was competing for the work. Moreover, there is always the possibility that a firm which might not have been expected to tender might find itself in a position where it would be prepared, for reasons not apparent to a Department, to make a special effort at a particular time. The Committee, therefore, considers that it would be dangerous to assume that the firm nearest the site of a building project will quote the most competitive price.

In paragraph 19 of its report dated 21 April 1977 the Committee had occasion to insist that the practice of competitive tendering be adhered to in all capital works’ contracts funded by the Exchequer whether they are managed directly by Departments or by outside agencies. This principle should be adhered to not only for projects which are fully funded by the Exchequer but also for projects which are partially funded by the Exchequer, such as that for the lamb fattening unit with which Roinn na Gaeltachta was involved. The Committee considers that this might be made clear to all Accounting Officers.

PUBLIC WORKS AND BUILDINGS

40. The Comptroller and Auditor General referred in his report to the absence of regular stocktaking at the Central Furniture Stores and also to the failure to investigate discrepancies which came to light during stocktaking which had been carried out as far back as May 1972. Despite an assuance given by the then Accounting Officer to the Committee of Public Accounts in November 1972 that the matter of stocktaking was being attended to and that the situation was satisfactory, no stocktaking had been carried out subsequent to that of May 1972. The Accounting Officer informed the Comptroller and Auditor General that only a limited reorganisation of the Furniture Branch had been carried out in 1972 and that it could not cope with unforeseen pressures arising from the furnishing of large additional areas of office space then being acquired in provincial centres as well as in Dublin. Moreover, problems arose because of the need to accommodate large quantities of redundant furniture resulting from the refurnishing of existing offices. Storage space was inadequate and there were continuing staffing difficulties. The storekeeping and recording procedures at the Central Furniture Stores, which had been designed to deal with what was essentially a maintenance service carrying comparatively small stocks, had been unable to keep pace with the vastly increased traffic in furniture. The recent acquisition of additional storage accommodation, however, had improved the position in so far as it was now possible to effect a physical separation and set up a separate recording system for furniture purchased in bulk to equip new offices as distinct from furniture required for the provision of a maintenance service. The staffing problem still existed because there was difficulty in recruiting and training suitable staff.

In evidence, the Accounting Officer informed the Committee that stocktaking had been completed in the two stores operated by the Furniture Branch and there would be continuous stocktaking in future. There was, however, an ongoing problem because of the vastly increased demands being made on the service since 1970 and because of the change in the standard and quality of furniture required. There was a need for a sophisticated stores system designed to cater for the requirements of the Furniture Branch and to cope with whatever furniture management problems that may arise. Not only had such a system not been set up but, in the Accounting Officer’s opinion, it was years away. Problems are dealt with on an ad hoc basis as they arise rather than on a systematic basis. Furthermore, there was still a shortage of experienced staff and although some additional senior staff had recently been authorised by the Department of the Public Service the Accounting Officer foresaw that there could be recruitment difficulties. He did not, therefore, see any immediate solution to the problems relating to the operation of the Furniture Branch and he felt that audit queries would continue to arise in that area. He could not give the Committee any guarantee except that the Office of Public Works would try to solve the problem on a management basis.

The Committee is concerned that the stores’ system in operation in the Furniture Branch of the Office of Public Works is considered by the Accounting Officer to be seriously inadequate especially having regard to the expenditure incurred on the provision of furniture. The value of furniture supplied by the Branch in 1976 was £1.4 million and stocks on hands at the end of the year amounted to £259,000. While the Committee accepts that there are ongoing problems in the control of the operations of the Furniture Branch it cannot agree that these problems can only be surmounted in the long term. It is of the opinion that the essential requisites for a satisfactory solution are adequate storage space and adequate trained staff and it cannot, therefore, see why the present unsatisfactory situation should be tolerated indefinitely. The Committee therefore urges that whatever further action deemed necessary be taken to put the stores system on a sound basis without delay.

41. The Accounting Officer requested the Committee’s agreement to the proposal that the Office of Public Works cease keeping accounts in respect of the Bourne Vincent Memorial Park, Killarney. This estate was handed over to the Office of Public Works in 1932 to administer as a national park but the Accounting Officer explained that, because of their inexperience as to how a national park should be operated, they attempted to develop it as a farm. During the Emergency period the land was used for food production and from 1947-48 farm accounts had been submitted to the Public Accounts Committee for its information. In the 1960s there was a different concept of what a national park should be and it was realised that it should not be used for commercial purposes such as farming. The Accounting Officer stated that the Office of Public Works has long ceased farming activities at the Bourne Vincent Memorial Park which is now used as a recreational resource.

The Committee notes from the farm accounts for this national park submitted for 1976 that there still seems to be an appreciable amount of activity in the raising of cattle the value of which was given at £14,100 at 31 December 1976. It is, therefore, at a loss to understand how farming activities can be stated to have ceased and it would welcome further detailed information on the usage of the park as a whole before deciding on the request made by the Accounting Officer.

DEFENCE

42. A total of £180,000 was paid from this Vote over the years from 1972-73 to 1975 to an Irish company for the production of three prototype armoured personnel carriers for the Department of Defence. A formal agreement was not signed with the company in relation to the production of these carriers but the Department was advised by the Chief State Solicitor that a contractual relationship existed on the basis of correspondence and pant performance. It was later reported that one of the developed prototypes together with a further incomplete carrier had been exported for demonstration purposes to a Belgian company which claimed in its publicity material that an armoured personnel carrier, for which it had acquired the production licences, had been developed in collaboration with the Irish Army. The Comptroller and Auditor General was informed by the Accounting Officer that the Department of Defence was satisfied as to its position and rights in relation to the carriers produced under the contractual relationship mentioned but that this relationship made no provision for any financial return to the Department.

In evidence the Accounting Officer stated that as this was a research and development project the Department considered that the expenditure had been properly incurred on the production of the three prototype carriers which had been handed over by the Company. The commercial price of the vehicles would be about £100,000 each and the Department’s expenditure on the project was not, in his view, out of proportion. Not only did they receive the three carriers in return for that expenditure but they also obtained all the drawings made in connection with their production. He looked forward to a situation developing from this project which would enable the Department to purchase, in the future, carriers made in Ireland instead of imported vehicles. The Accounting Officer also stated that the Irish company did not accept the claim made by the Belgian company that the vehicles for which they had production licences had been developed in collaboration with the Irish Army but insisted that they were entirely different from the prototypes supplied to the Department of Defence. In regard to the non-execution of a formal contract with the company the Accounting Officer added that the company had refused to sign the detailed agreement prepared by the Department While the Chief State Solicitor had advised that, on the basis of the correspondence, the draft agreement and part performance, the company had committed themselves to a contract he subsequently advised that the Department in insisting on its proposals to guard against possible exploitation would be endeavouring to impose too restrictive an obligation on the company, one which might not stand up in law.

The Committee considers that projects such as the present one, which aim at developing products and, in particular, capital products, which can be substituted for imported products, are very worth-while and commends the desire of the Department of Defence to encourage the production of home manufactured personnel carriers. Nevertheless, it has reservations about the use of moneys voted for Defence to subsidise a research and development project which, in its view, lies outside the ambit of this Vote. It considers that such State aid could more suitably have been provided by one of the agencies specially set up for that purpose and it understands that one such agency has, in fact, since joined the company concerned in this project. The reason given for the financial involvement of the Department of Defence in the project was that the Department was the only customer in Ireland who would be buying equipment of the nature being produced. While it might have been true that the Department was the only likely home-based customer for this equipment there was no reason to assume that foreign purchasers would not be interested in the product and in the event such a purchaser did appear on the scene.

While the Committee accepts that a contractual relationship existed between the Department and the company concerned in this project, it considers that it would have been more satisfactory if a formal contract had been signed in which provision could have been made for a sharing by the Department in such matters as patent rights, production rights etc., and also for a financial return on its investment in the event of the project proving successful. The Committee holds the view that where the Exchequer provides financial resources for a research and development project, which results in a product capable of commercial exploitation, the Exchequer is entitled to share in the financial benefits. The Committee recognises that it is now too late to make provision for such a sharing in the present project but it would urge that such provision be made in any future cases of this nature which may arise.

LANDS

43. The Farmers’ Retirement Scheme provides for the purchase of land by the Land Commission in accordance with EEC Directive 72/160. Lands so purchased are to be allotted (a) by way of priority to farmers classified as potential development farmers under the Farm Modernisation Scheme or (b) for afforestation, recreational activities, public health or other public purpose. Lands not required for any of these purposes may be allotted to other farmers.

The Retirement Scheme provides for the payment to an eligible applicant of the agreed market price of his land together with a cash premium of 10 per cent of that price and a life annuity. Where land so purchased is allotted to potential development farmers or used for afforestation, recreational purposes or public health or other public purpose a proportion of the cost of the life annuity in the case of an applicant between the ages of 55 and 65 years is recoverable from the European Agricultural Guidance and Guarantee Fund.

The Comptroller and Auditor General drew attention to the fact that some lands purchased under the Retirement Scheme in 1975 had not been allotted as apparently there were no potential development farmers locally who required additional land. He stated that he was concerned lest lands, which could possibly have been purchased at a lower price under the Land Purchase Acts, had been purchased under the more expensive Farmers’ Retirement Scheme. The Accounting Officer had informed him that close working arrangements had been established between the Land Commission inspectorate and the agricultural advisory staff engaged on the Farm Modernisation Scheme to ensure, to the maximum possible extent, that lands purchased under the Retirement Scheme are disposed of to development farmers needing additional lands and that the aim is that Retirement Scheme lands should not be allotted for normal structural purposes unless it was confirmed that there were not and were not likely to be suitable development farmers in the locality.

In evidence the Accounting Officer pointed out that the purchase and disposal of lands not only under the Retirement Scheme but of all lands are by legislation reserved functions of the Lay Commissioners who decide the terms of purchase and disposal and he, as Accounting Officer, has no control over these matters. He stated that up to the end of September 1978 they had acquired just under 17,000 acres under the Retirement Scheme, of which 3,000 acres had been distributed, leaving 14,000 acres on hand. He further stated that progress was being made in many cases and schemes were in preparation for the distribution of this land. He added that the position in regard to the land purchased under the Retirement Scheme was no worse or no better than land purchased by normal acquisition methods. While at first sight one could regard the buying of land under the Retirement Scheme as more expensive than the buying of land by the normal acquisition methods, there are other factors to be taken into consideration. Land was being purchased from old people and it would be rather harsh to use compulsory acquisition powers against them and force them off the land if they had no wish to go.

The Committee wonders whether the Farmers’ Retirement Scheme is being used in a way which was not intended thus giving rise to unnecessary additional expenditure on land acquisition. If lands are required for development farmers under the Farm Modernisation Scheme then, in the Committee’s view, it is right that they be acquired under the Retirement Scheme and full advantage taken of any subvention available from the EEC. If, on the other hand, land which is not required for development farmers, is being offered to the Land Commission under the Retirement Scheme simply to take advantage of the higher price then, in the Committee’s view, serious consideration should be given to the refusal of such offers the acceptance of which could only result in an additional unnecessary charge on public funds. The Committee is aware that, as the Accounting Officer pointed out, other factors may fall to be considered in some cases. Nevertheless, it would welcome further comments from the Accounting Officer on the feasibility of this suggestion. The Committee notes that while the Accounting Officer is accountable for all funds made available by Dáil Éireann through the Vote for Lands he has no control over decisions of the Lay Commissioners which involve, inter alia, the expenditure of these funds on the purchase of land. The Committee considers this position to be unsatisfactory and it would welcome the views of the Department of Finance on the matter.

HEALTH

44. An agreement made in July 1969 between the Pharmaceutical and Allied Industries Association and the Department of Health provides for the payment to the General Medical Services (Payments) Board of rebates by the manufacturers and importers of drugs and medicines required for the General Medical Services. The net expenditure of the Payments Board is met from the Vote for Health. The agreement requires the Payments Board to supply each manufacturer and importer with a monthly statement of the number of prescription items dispensed by retail pharmacists for each of the firms products in each Health Board area. The rate of rebate payable was originally fixed by the agreement at three old pence per prescription item based on the monthly statements but it was provided that the rate should be subject to adjustment so as to remain approximately 4 per cent of the average ingredient cost per prescription item should that cost increase materially.

The Comptroller and Auditor General noted from the report of the Local Government auditor on the accounts of the Payments Board for 1973, 1974 and 1975 that the rate of rebate, which remained at the original level of three old pence, had fallen appreciably below the 4 per cent level and he sought the observations of the Accounting Officer regarding the delay in having the rebate rate adjusted upwards as provided for in the agreement. The Accounting Officer stated that in practical terms a review of the agreement between the Association and the Department could not have been undertaken before January 1975 when statistics for two full years of operation of the General Medical Services first became available. The Department held the view that the adjustment of the rate of rebate would not be dealt with in isolation by the Association which could legitimately ask to have the qualifying limits governing the special discounts allowed to hospitals on drugs purchased by them adjusted upwards and, indeed, could reasonably claim that the whole agreement should be re-negotiated in the light of the increase which had taken place in the percentage of the population eligible for General Medical Services.

In evidence the Accounting Officer told the Committee that the Department estimated that a review of the rebate rate to bring it up to the level of approximately 4% of the drug cost would provide the Payments Board with an additional sum of £300,000 a year. On the other hand the discounts on drugs earned by hospitals under the agreement were of the order of £1 million per annum. The reduction of these discounts arising from an upward adjustment of the qualifying limits would be greater than the possible gain from an upward adjustment of the rebate rate and, in the circumstances, it was considered that it would not be in the Department’s interest to press for a revision of the agreement.

The Committee has certain reservations about accepting in full the case made by the Accounting Officer for not seeking an upward adjustment of the rebate rate. It considers that the rate of three old pence which was agreed when the agreement was originally signed in 1969 is unrealistic in 1979 especially in the light of considerable increases which have taken place in drug prices in the intervening years. It does not agree that an adjustment upwards of the rebate rate should be automatically followed by a pro rata upward adjustment in the qualifying limits governing the rates for drug discounts. Undoubtedly, an increase in the percentage of population eligible for General Medical Services must result in some reduction in the demand for drugs and medicines outside the scheme but the Committee remains to be convinced that this reduction is significant. On the other hand there are a number of factors which should be taken into consideration such as the very substantial increase in total payments made to the drug industry under the scheme and the high credit rating of Health Boards and hospitals resulting, no doubt, in the elimination of the risk of bad debts to manufacturers and importers in this very extensive area of their business. Moreover, the Committee would suggest that the industry’s expenses in filling orders from Health Boards and hospitals should work out relatively lower than the expenses in meeting orders from numerous chemists throughout the country.

The Committee commends the Department of Health in arriving at this agreement with the Pharmaceutical and Allied Industries Association in order to reduce the burden of the General Medical Services on the Exchequer. It suggests, however, that the question of updating the agreement might be considered in the context of an overall review of the arrangements for the supply of drugs and medicines under the General Medical Scheme. The Committee considers that the advice of outside consultants might be profitably sought in this matter.

45. The cost of medicines supplied by pharmacists on the basis of stock orders to dispensing doctors in rural areas is met by the General Medical Services (Payments) Board and, therefore, ultimately falls as a charge on the Vote for Health. These medicines, which cost £1,872,360 in the year ended 31 December 1975, are supplied under a scheme which enables a doctor having a centre of practice three miles or more from a participating pharmacist to dispense medicines for patients served from that centre if they so desire. The Comptroller and Auditor General reported that he had noted from the Local Government Audiotrs’ report on the accounts of the Payments Board that doctors were not required to account under the scheme for medicines dispensed nor for stocks held by them. The Accounting Officer had indicated that it was intended to introduce a recording system in relation to these medicines from 1 January 1978 under which doctors would be required to forward to Health Boards copies of all orders for the supply of medicines. The Health Boards would thus be in a position to monitor the quantities and types of drugs being ordered and to have alleged abuses investigated by qualified pharmacists whose full-time appointment to the staff of the Health Boards had been approved by the Department of Health.

In evidence the Accouting Officer informed the Committee that the availability of pharmacists on the staff of the Health Boards was essential to the operation of the monitoring procedures. The Boards, however, had experienced difficulties in recuiting qualified pharmacists and only some Boards had been successful. Where pharmacists have been appointed the monitoring of the doctors’ orders for drugs under the scheme is proceeding.

The Committee notes the introduction of procedures for the monitoring by qualified pharmacists of doctors’ orders for drugs under this scheme and for the investigation by such pharmacists of any alleged abuses. It must express its concern, however, at the lack of control for a period of years over the operation of a scheme which places a considerable financial burden on the Exchequer. It requests that any Health Board which may not yet have appointed a qualified full-time pharmacist to its staff to monitor transactions under this scheme in its area should be urged to do so without further delay.

SOCIAL WELFARE

46. The Comptroller and Auditor General drew attention to the theft from the computer section of the Department of Social Welfare of 742 benefit cheques to the value of £15,528 drawn on the Social Insurance Fund. It had been established that 109 of the cheques to the value of £2,342 were fraudulently cashed. The shortfall in the income of the Social Insurance Fund is made good from the Exchequer which will, therefore, ultimately bear any consequential loss. The theft was apparently facilitated by inadequate internal security and it came to light through inquiries made by the Post Office Investigation Branch when benefit cheques were not received by payees. Court proceedings had been taken against a number of persons and new security procedures had been introduced. The Accounting Officer assured the Committee that there was no evidence to suggest that any more of the stolen cheques had been fraudulently cashed and he was satisfied that £2,342 was the final amount of the loss involved.

The Committee is extremely perturbed that a theft of benefit cheques should have been so easily perpetrated within the Department due to failure to take fundamental security precautions and hopes that the new procedures introduced will prove effective. It wishes to be informed in due course of the results of the court proceedings.

47. The Comptroller and Auditor General also drew attention to the submission of a fraudulent claim for disability benefit by a member of the staff of the Department of Social Welfare. The preparation of the claim involved the use of documentation relating to a claim already paid to an insured person and the alteration of the computer records. The attempted fraud was detected before any payment was made and the Accounting Officer expressed himself as being satisfied that the internal controls on access to claim documents and computer terminals was as adequate as is possible in the type of ongoing working situation necessary for the daily issue of disability benefit payments. In evidence he informed the Committee that the basic difficulty was that the issue of cheques is urgent day-to-day business and the staff must have unlimited access to computer terminals. A review of security had shown, however, that some cross-checkings had fallen into disuse and this had been remedied. He added that since the making of payments on time imposes certain constraints, it is not possible to have a watertight system.

The Committee recognises the problems of the Department of Social Welfare in having to meet weekly deadlines in the preparation and issue of a large number of cheques. Nevertheless, it is concerned lest internal security may, as a result, have come to be regarded as having a low priority. This is suggested by the fact that certain cross-checking procedures had fallen into disuse. The Committee wonders whether there are other areas within the Department where, because of pressure of work, prescribed control procedures are not being followed. It asks that a survey be undertaken to establish whether this is so and that it be informed of the outcome.

48. The Comptroller and Auditor General reported that an examination carried out by his officers revealed that controls relating to the preparation, custody and issue of children’s allowance books and over the disposal of books returned to the Department were inadequate. The Accounting Officer had stated that he considered that some of these controls were adequate and that others were as good as they could be having regard to the constraints of the daily work routines, the accommodation provided and the staff available to deal with the increased volume of work which had arisen in recent years. As a result of discussions between officers of the Department of Social Welfare and the staff of the Comptroller and Auditor General the controls were subsequently strengthened in a number of areas.

The Comptroller and Auditor General told the Committee that, because of the substantial face value of the individual allowance orders and the relative ease with which they can, apparently, be cashed on occasions, he considered the aim should be to have the controls over their custody and issue on a par with the controls exercised over the custody and issue of cash.

In evidence the Accounting Officer informed the Committee that following an inspection of the Children’s Allowance Branch of the Department a number of improvements had been made. Part of their difficulties arose from inadequate accommodation and from the heavy workload arising from processing some 430,000 live claims covering 1.1 million children. He agreed that there had been certain basic weaknesses in security but he felt that when the accommodation problem is solved they should be able to meet all reasonable requirements in that regard. On the advice of the Comptroller and Auditor General they had reintroduced monthly stocktaking. The Accounting Officer had satisfied himself that they had made considerable progress towards reaching a satisfactory level of control and that they would be able to make further improvements when the accommodation problems were solved.

The Committee recognises the difficulties facing the Department of Social Welfare in handling the large volume of work involved in the Children’s Allowance Branch. Nevertheless, it is seriously concerned that any weakness in controls should exist in this area because it agrees with the views of the Comptroller and Auditor General that the controls over the processing of these allowance orders should be such as are exercised over the handling of cash. It urges, therefore, that whatever action is still required in order to achieve the necessay level of security should be taken, as a matter of urgency, by the Department of Social Welfare and other Government Departments concerned.

The Committee would wish to be assured that the strictest level of security is maintained in the other branches of the Department of Social Welfare responsible for preparation, custody and issue of pension and other allowance orders.

GENERAL

Late Submission of Appropriation Accounts

Qn 180

49. The Comptroller and Auditor General drew the attention of the Committe to the fact that out of fifty-one Appropriation Accounts submitted to him for 1976, fifteen had not been received by him on the statutory date, 30 April 1977. The Committee is concerned at the failure of certain Accounting Officers to comply with the statutory requirements in regard to the submission of Appropriation Accounts.

It understands that the Minister for Finance has issued a circular to all Accounting Officers impressing on them the necessity for submitting their Appropriation Accounts as early as possible after the year-end and not later than the statutory date. The Committee trusts that it will not have to refer to this matter again.

Overtime

Appendix 14

50. In accordance with existing instructions every Appropriation Account includes a note indicating the number of persons on the staff of the Department or Office in receipt of overtime payments in excess of £200, the upper and lower limits of these payments and the total amount expended on overtime. The Committee wishes to ascertain the total number of persons in each Department or Office in receipt of overtime payments irrespective of the size of such payments and it asked each Accounting Officer when he appeared before it to include this figure in the relevant note in the Appropriation Account in future. The Committee has requested the Department of Finance to issue revised instructions to Accounting Officers in this matter and it understands that this has been done.

In the course of its consideration of the Appropriation Accounts the Committee noted some cases in which overtime payments made to individual officers appeared to be of a level high enough to warrant the appointment of additional heads of staff. The Committee accepts that the level of overtime payments is not the only consideration to be taken into account when deciding whether or not to appoint additional staff in such cases. It can envisage circumstances in which there might not be any real alternative to the payment of overtime to existing staff members, as for instance when State security or confidentiality requires particular tasks to be assigned to officers of proven ability and discretion or where the extra tasks to be performed must be carried out continuously over a relatively short period. Nevertheless, it is concerned lest opportunities for creating additional posts in the Civil Service might be unwittingly lost through the continuous payment of substantial sums in respect of overtime and it would welcome the observations of the Department of the Public Service on the matter.

Qns 3-5

Qns 106-108

Qns 204, 205, 210-212

Qns 587-590, 605, 606

51. In the course of its examination of a number of Accounting Officers the Committee noted that some Departments and Offices appeared to have accommodation problems and staffing problems which were giving rise to shortcomings in financial administration, especially in the areas of internal control and security. While some such cases are specifically referred to in other paragraphs of this Report further instances also came to the notice of the Committee. In the Office of the Chief State Solicitor accommodation problems which had been in existence for a number of years and difficulty in attracting suitable candidates had prevented the filling of vacancies. The Committee wonders whether this is giving rise to delays in clearing the legal work carried out by this Office and whether this causes any problems for other Departments.

In the Valuation Office 16 vacancies in the technical grades and a number of vacancies in the clerical assistant grade were unfilled and the Accounting Officer stated that efficiency might be affected because the existing staff are overloaded.

In the case of the Office of the Revenue Commissioners the Comptroller and Auditor General drew attention to a number of cheques received from taxpayers which had not been lodged promptly or which had been mislaid. The Accounting Officer stated in evidence that, while the regulations for dealing with cheques which come in through the post are very stringent and in general are strictly enforced, failure to comply with the procedures could occasionally occur through inexperience of the staff or because of the heavy volume of work. In regard to Value-Added Tax, the Accounting Officer felt that more staff are needed to deal with the problem of tax evasion.

The Accounting Officer for the Vote for Social Welfare informed the Committee that difficulties in regard to recording the recovery of overpayments could be overcome by reprogramming the computer. However, due to demands on the limited expertise in computers both in his Department and in the Department of the Public Service they had not advanced as far as they would like towards having an adequate system of checking on benefit payments by computer. The Accounting Officer assured the Committee that the Department was conscious of the need for such a system and that it would be set up as quickly as possible but that the basic problem was one of training personnel to revise programs.

The Committee also learned that the substantial increase in 1976 in the amount of overpayments of Social Assistance which came to light was mainly due to pressure on staff because it was not possible to get sufficient staff to cope with the increase in the intake of claims resulting from changes being made in the conditions governing entitlement.

The Committee feels that, if these staffing and accommodation problems are left unsolved, some of them at least could have serious consequences not only in the area of general administrative efficiency but also in the area of financial control. It also feels that there may be problems of a similar nature in other departments which have not come to its notice. It suggests that the Department of the Public Service might examine this matter and it wishes to be informed of the outcome of such examination.

Qns 93-97

Qns 381 ,382

Qn 530

52. During the course of its examination of the Appropriation Accounts the Committee noted cases in which there appeared to be some overlapping of the functions carried out by a number of Government Departments and other State agencies.

The Accounting Officer for the Vote for Foreign Affairs informed the Committee that the expenditure under Subhead F—Information Services, covers the purchase of books and photographs and the production of films for showing abroad. He stated that this is a valuable method of promoting tourism and it is also of assistance to industry because some of the films deal with Irish industries. He agreed that other State-sponsored bodies such as Bord Fáilte Éireann, Córas Tráchtála and the Industrial Development Authority etc., are engaged in the same kind of work and that there might therefore be some overlapping. The Department, however, is very conscious of the need to co-ordinate its activities with those of the other agencies, and the Accounting Officer believed that such overlapping as exists is kept to a minimum.

The Accounting Officer assured the Committee that very close liaison exists between his Department and the State agencies engaged in promoting particular aspects of policy abroad such as the Industrial Development Authority, Córas Tráchtála and Gaeltarra Éireann. However, the Committee is aware that Gaeltarra Éireann has recently opened an office in Germany but when the Accounting Officer was questioned on this matter on 19 October 1978 he did not appear to have been aware that this was proposed. This would, to say the least, raise certain doubts about the effectiveness of this liaison.

When examining the expenditure out of Cuntas Chiste na Gaeilge which is appended to the Appropriation Account of the Vote for Roinn na Gaeltachta the Committee considered whether there might be overlapping or duplication in the functions of some of the bodies to whom payments were made. The Accounting Officer for the Vote for Roinn na Gaeltachta agreed that there was some scope for overlapping but stated that his Department keeps this matter under review when examining the work programmes and audited accounts of the bodies concerned. Since there was a considerable amount of work to be done he did not see anything wrong with different bodies doing the same kind of work in different places.

While the Committee might agree that this position could be acceptable in special circumstances it also sees that there might be a danger of an organisation getting Exchequer funds from different sources for the same work.

The Accounting Officer for the Vote for Agriculture agreed that some of the activities of his Department provided for under Subhead B.7 of that Vote—Research and Testing—have a connection with the activities of An Foras Talúntais. Provision is made under this subhead for veterinary research some of which will be transferred to An Foras Talúntais under pending legislation. Provision is also included in the Vote for meat research from which a contribution is made to An Foras Talúntais to supplement assistance being given by the meat export industry for this purpose. There are other serivces provided for in this Vote where there is a certain marginal overlapping with research work and the Department has been considering whether some of these, the more specific research aspects, could be transferred to An Foras Talúntais.

The Committee is concerned lest the overlapping of activities which exist between various Departments and other State agencies might lead to wasteful expenditure. It is also concerned that there is a possibility of Exchequer grants being given from different sources for the same work. It suggests therefore, that this matter of overlapping of functions exercised by Departments and other State agencies might be examined in depth in order to remove the danger of wasteful expenditure or double funding.

PADDY O’TOOLE,

Chairman

26 April, 1979